Power shares

[LaserEyeKiwi]

Worth reading the Contact annoucement.

https://www.nzx.com/announcements/356004

Contact clearly confirming the reality that power prices will drop with the language about turning to minimizing the financial impact in a “lower demand” market and pausing construction of new generation assets.

Anyone hoping that the impact of this will not be felt nationwide on all generators is deluding themselves.

[Panda-NZ-]

Long term gain for them I imagine. No need to be locked in to selling high amounts of power for very low prices.

Might pick up some we'll see.. exciting day for traders.

[RTM]

MEL $ 4.31 down 18 %

Hope you got some...check again.

[xafalcon]

Long term gain for them I imagine. No need to be locked in to selling high amounts of power for very low prices.

No. Long term loss for them. Tiwai Pt soaked up low cost energy, meaning Max Bradford's distorted pricing mechanism allowed higher price thermal generation to set the spot price for the remaining 87% of NZ power. Meridian used this exact same pricing mechanism to increase their return by spilling water. It will be a long term loss for the generators, hence why I think they will going with government and transpower to come up with a deal to keep the parasite in NZ

[freddagg]

Contact clearly confirming the reality that power prices will drop with the language about turning to minimizing the financial impact in a “lower demand” market and pausing construction of new generation assets.

Anyone hoping that the impact of this will not be felt nationwide on all generators is deluding themselves.

Contact are talking closing their Taranaki thermal, and delaying Tauhara. NI power prices could increase considerably.

[macduffy]

Well said, good riddance Rio. Sad about job losses though but NZ Inc need to invest to create new jobs in other industries.

A nice sentiment but we have a long history in seeking diversification of industry without much success. Car assembly, a nylon factory in Shannon, goat farming, possum skin creations and more. What do you suggest?

[trader_jackson]

it is laughable how much the share prices have gone down... Mr Market no where near close to pricing in the long term impacts of this shock to the system... maybe when the power sector is down 25% or so on average (not 9% ish on average currently) from yesterdays price things will be back to something a bit more understandable... these are no longer bond proxies... and therefore shouldn't be priced like one.

[Joshuatree]

No discussion about the remediation costs RIO have to do.Whats was it $150 mill plus remediation?

[Panda-NZ-]

it is laughable how much the share prices have gone down... Mr Market no where near close to pricing in the long term impacts of this shock to the system... maybe when the power sector is down 25% or so on average (not 9% ish on average currently) from yesterdays price things will be back to something a bit more understandable... these are no longer bond proxies... and therefore shouldn't be priced like one.

Interest rates. there is no alternative even now. It will provide something of a floor.

[Sideshow Bob]

$250m+ in remediation costs. Grunty…..

The other share that will be affected (not a power company) is South Port.